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Premier League’s ‘relentless revenue growth’

Premier League's 'relentless revenue growth'

The Premier League’s “relentless revenue growth” has helped England’s top four divisions set new records for earnings, spending and tax, according to the 26th edition of Deloitte’s Annual Review of Football Finance.

Published on Wednesday and based on the 2015/16 season, which provides the most recent set of full accounts for the 92 clubs, the report outlines an industry that appears to be immune to austerity or recession.

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The 92 clubs combined to generate a record £4.4bn, with the Premier League’s 20 clubs contributing £3.6bn of that sum, up almost £300m, or 9%, on 2014/15.

This breaks down to average earnings of £182m per Premier League club, more than the total revenue of all 22 Division One clubs in 1991/92, the season before the Premier League’s creation.

Lucrative kit deals have proved to be a healthy source of income for English clubs

Lucrative kit deals have proved to be a healthy source of income for English clubs

The authors of the 32-page report make clear European football is doing well but the continent’s richest clubs are doing even better and England’s richest clubs are doing best of all.

As the report’s foreword puts it: “We return to two familiar themes as we assess the 2015/16 season – the continuation of relentless revenue growth across Europe’s major leagues, in particular the Premier League, and the commitment of this money to spending on players via transfer fees and wages, again led by English clubs.”

The key driver to all this growth is television and what is perhaps most remarkable about the the Premier League’s turnover in 2015/16 is that it came in the last year of a three-year domestic broadcasting deal before BT and Sky combined to pay £5.1bn for three seasons of rights from 2016/17, an increase of 71%.

New stadia – such as Tottenham Hotspur’s – are a key factor in revenue growth

In a statement, the report’s editor, Dan Jones, explained that much of the league’s growth was driven by the fact the ‘big six’ of Arsenal, Chelsea, Liverpool, Manchester City, Manchester United and Tottenham played in Europe and benefited from UEFA’s improved rights deals, as well some significant commercial wins, most notably United’s reported £75m kit deal with Adidas.

But Jones believes there is a lot more upside still to come.

“With the commencement of the new Premier League broadcast rights cycle in 2016/17, supported by new commercial agreements at clubs and matchday revenue growth from new and expanded stadia, we expect total Premier League clubs’ revenues to rise to over £4.5bn in 2017/18,” he said.

 

Premier League's 'relentless revenue growth'
Gary Neville (centre) continues to play a key role in Sky Sports award-winning coverage

The clubs in England’s top four divisions combined to pay a record £1.6bn in tax while there was a 12% increase in wage costs in the Premier League to £2.3bn, more than double the amount paid by Europe’s next biggest spender, Spain’s La Liga.

Leicester City were champions in 2015/16 with the Premier League’s 15th biggest wage bill, while the league’s two lowest payers in 2015-16, Watford and Bournemouth, avoided relegation and are still in the league now.

Meanwhile, last season saw Huddersfield promoted with the fourth-lowest budget in the Championship and no parachute payments – one of the Championship’s biggest sources of income.

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